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tv   Bloomberg Markets Americas  Bloomberg  June 16, 2017 10:00am-11:01am EDT

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mark: i am mark barton in london. let's get to the markets. julie: overall, markets are pretty sleepy this morning. we are seeing small declines across the board so let's talk about this big deal that is creating some excitement come a some non-politics based excitement for a change. when you look at the two parties involved in this deal, amazon is also rising. that is because analysts and investors are looking at this deal, seeing it as a way to give amazon more physical exposure, more of a supply chain as it has been trying to expand into the grocery business. of course, it is in so many other physical goods and has not been as dominant in the grocery business. whole foods rising just about to the offer price of $42 a share. the total price of the deal is $13.7 million.
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amazon shares up about 3% and i have not checked to see if they are at a record. as we know, amazon has been pulling back in recent days and has not quite re-attained record status. is what weeresting are seeing throughout the grocery industry. you can look at the effect amazon had on the book industry, or the effect it is having on the apparel industry currently to understand why these other stocks are trading down by so much. there is great concern seemingly among traders and investors as to what kind of disruption this will cause within the broader grocery business. walmart has been trying to forestall that with its recent acquisition of jet.com. quietly today it confirmed it was buying a men's apparel online-based retailer. target shares down 10%, although target does not get the majority of its ales from the grocery aisle.
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walmart gets about half of its sales from the grocery aisle. ,roger, a huge trump -- tumble down 18% and down another 14% today. sprout is down 12% as well. costco is down today as well, dollar general down, dollar tree down as well. really interesting map on the bloomberg, this is pretty cool. let's take a look here, this is a map of the united states. amazon facilities in yellow, whole foods stores and blue so when we talk about amazon distribution network that it has been building out quite aggressively, the blue points give you an idea of not only a grocery store that will be used as a grocery store but also as a potential distribution center and source on its supply chain. the yellow dots are amazon and the middle of the country gives
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it a little more exposure, and we will see what happens. whole foods' strategy has been to open smaller stores that are costed 365 that are lower you we will see what this does not only for amazon but what it is going to mean for whole foods' strategy. the strategy has not been working terribly well with comparable sales declining in recent quarters. vonnie: exactly, it became less and less unique as a grocery business. for more on the amazon-whole field -- whole foods deal, nick turner and spencer sofer. is it a coincidence that just last month we got what, five new directors can teach with a lot of experience in the retail and turnaround stories. deal ands an enormous a significant premium but it does not, to a complete desk as a complete surprise.
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amazon was exploring this deal last fall and it did not quite go through but after a lot of trial and tribulations at whole foods and the activist investors stepped in, it was then that amazon started renegotiating the talks with whole foods. vonnie: spencer sofer is on skype and let me ask you, what will be the first thing that -- happens with regard to whole foods' footprint? will they downsize or get rid of some brands? spencer: i think it is a little early to speculate. the main thing is getting a physical footprint that amazon has lacked and realizes it needs. they have been trying to crack the grocery code for 10 years and it has been a source of internal tension of how far and deep to go on the brick-and-mortar side, that they have been experimenting with. this is a big sign that amazon
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realizes it has to go pretty deep in brick-and-mortar, especially on grocery. mark: we know that amazon's cash rate, is this the best use of its cash? can you hear me? i will try that again. we know amazon is cast rich -- cash rich. is this the best use of its cash? vonnie: selena, let me ask you that question instead. obviously a huge amount of cash come $13.7 billion. >> this will not be a chance for them to get loans from the big banks. investors and analysts are seeing this as a big deal for amazon as it greatly extend the -- increases their distribution. it is hard to keep refrigerators to keep goods fresh and where houses and with whole foods they are able to expand their ,ootprint to metropolitan areas
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and have delivery to your doorstep as quickly as five minutes. it will completely change the way we buy groceries. mark: julie just telling us about its new strategy, whole foods, smaller food -- smaller 365 strategy. what will amazon due to whole foods? >> i think it is pretty early to say what that is going to look like that we can come up with some ideas. they could start using stores as distribution centers, as part of their supply chain to have quick delivery to consumers. we may even see some integrations between amazon prime and having an easier, quicker shopping experience inside whole foods. amazon fresh pickup as well as the physical bookstores, and throughout the industry we are starting to see a convergence of online and off-line retail and how to make the experience better for the consumer. i am looking at shares on both sides of the atlantic.
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retailers sinking everywhere. what are you thinking if you are walmart or target? i am looking at tesco shares in the u.k., 10% lower. when are you thinking if you are a brick-and-mortar retailer today? spencer: you are very worried because you have had the physical locations, has been your primary defense against amazon. and so now amazon is obviously going after those physical locations and it is also going after grocery. the big thing that grocery gives is even though it is low-margin, it is high frequencies of that gives you constant engagement with the customer. something people by four to five times a month. amazon is basically going to keep gobbling market share as it gets more and more of your spend. think of the other things it can do if it is engaging our customers on a weekly business -- basis in stores. vonnie: amazon has not really cracked the grocery code and has
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been working on it for a decade with amazon fresh direct, but will this help? is whole foods good at delivery? >> know, but amazon is great at delivery. the problem is there is only certain things you are willing to buy grocery wise to have delivered. you might be willing to get a pack of paper towels or some canned goods boxed goods that it is not necessary to inspect, but as long as you were going to the store any way to get your you canoranges, steaks. get those other packaged products while you are there any way. this is been the missing link for amazon and if they can get people in their stores to buy those fresh goods and get them familiar with amazon products, and comfortable with amazon fresh products in stores, that can open a huge window for them to do more deliveries and just integrate everything like selena talked about. maybe you go into the store and
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pick at your produce and the things you want to inspect yourself, but there could be a back in the operation selling packaged goods. vonnie: how much will this existingze amazon's products and brands? whole foods be a different brand within the amazon store or will it be integrated? >> i do not really see this cannibalizing on amazon's products. this will add an entirely enormous grocery segment. right now there is pretty low pay -- and its ration of amazon fresh. said, this is a huge branding opportunity for amazon to get their name out there, amazon prime to get out there, and to capture this high-frequency pool of consumers were constantly buying groceries and interacting with the amazon, amazon prime brand. this is a huge branding and distribution opportunity for amazon. mark: just coming back to the shares, they are down across the
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retail space there and in europe. why are some retailers rising? you might think today, they the amazon will not stop with whole foods, maybe there will be more acquisitions. what do you think? spencer: it is possible. it is a very big acquisition for them, their biggest on record and if they are willing to throw this kind of money around they might be more willing to buy other things as well. talk that they are a potential buyer of slack which could help with their cloud computing division, and amazon is getting so big now that this internal mantra of we don't buy, we build, may not be realistic. if there is markets they want to get into and the price is right, acquisitions can be a better strategy to get a quick jump. vonnie: thanks to bloomberg's selena laying and spencer sofer. let's check in on the first word news. courtney: deputy attorney
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general rod rosenstein appears to be president trump's latest target. in a tweet the president took aim at the man who appointed the special prosecutor to look into the russian acquisitions. intoeeted -- i am looking taking stepson is to break the stalemate in the war in afghanistan. according to the associated press it is sending almost 4000 more american troops. the top american commander in afghanistan says he does not have enough forces to help afghan troops. russia claims it may have killed the leader of islamic state. they are verifying intelligence that abu bakr al-baghdadi was killed late last month in a russian airstrike near the islamic state's de facto capital . other members of the group are said to have died but the russian foreign minister says
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there is no 100% confirmation. as they have for more than a century, republican and democrat congressional teams played their baseball team -- game last night, 36 hours after a gun man opened fire on republican practice. won 11-2. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am courtney donohoe. this is bloomberg. mark: just going to show you two charts. this is the stoxx 600. a good gauge to look at the industry group on the bottom, it is retail, much worse performer than the others. retail, 1.3% lower. i clicked on the retail, mrr, great function to show you the movements. tesco, for all these retailers they have been hit hard today by this news that amazon is taking over whole
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foods. tesco was already in the news because it had some sales figure come in -- sales figures come in. prior tottle changed this news. us is a big u.k. supermarket retailer and earlier it posted its longest -- largest u.k. growth in seven years. today is having rebels right across the world. tesco, just one of the retailer sinking, down by 5.4% tiered lots more on this big deal. this is bloomberg. ♪
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vonnie: breaking news, amazon buying whole foods for $13.7
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billion and we are seeing massive stock reaction, both those stocks and grocery stores around the world. we come to the end of a busy week for central banks across the world. while they are not moving in harmony just yet they agree on one thing, received with caution. >> the plan is one that is consciously intended to avoid creating market strains, and to allow the market to adjust to a very gradual and predictable plan. conditionsl market in global financial markets influenced by central banks like the ecb and fed has a big influence on global interest rates and has a big impact on exchanges. we look at those developments very carefully. >> it is not appropriate to give exit simulations on banks' finance at this point in time. we still have a long way to reaching the 2% target.
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the impact depends not only on the economic conditions and monetary policies. giving specific simulation could lead to confusion in the market. vonnie: joining us to wrap the week is dominic konstam. a little bit of a crazy week for rates. one of our guests during the week told us that u.k. is the absolute epicenter of financial repression. and you agree? dominic: maybe to some extent but the u.k. is a special case because there is huge uncertainty around the brexit and what that means for rates. you get a bifurcated view, some people worrying there will be an inflation problem, inflation is rising and the bank of england has to react. on the other hand, if it is all about the currency you do not know whether that is a temporary one or not. the guidanceabout
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that we got from the federal reserve? theot this addendum almost whole thing laid out. the only thing that was missing was the start date. willic: we are guessing it start in october and it was pretty much as expected in terms of the numbers they are talking about. it will take them quite a while to normalize the balance sheet, probably talking about early 2024. this is a very slow process and in our model, it will not have a massive impact in raising yields anytime soon. the bigger issue is still that quantitative easing is going on in europe and japan and that is much more important. you have another issue of whether the fed is doing the right thing in raising rates, three hikes rather quickly. mark: let's look back to the early 1990's to the 2000, to 2004 to 2006. i have highlighted where the fed
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has been raising rates that is interesting because rates went up and treasury yields for the .arge part went down many called it the greenspan conundrum but it is not a conundrum anymore. are we entering similar times? dominic: yes, to some extent there is a conundrum because the turf has been flattening and long-term rates have been very stable and recently have clawed their way back down and the fed is still raising rates. the conundrum was driven by what we called a global savings glut, foreigners with a lot of excess savings and they were looking for places to park their money. i guess the replacement is that -- central banks doing quantitative easing. there is not that much corporate issuance or non-central-bank it.ance to actually offset that is where the conundrum comes from, a shortage of quality assets for investors to buy. it keeps yields very low. mark: we have had a big week for
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central banks, the fed, boe, boj. what is the big takeaway if we can take away one thing? the boe was a bit more hawkish than we thought, probably the fed too. the big takeaways on a global's test global space. -- global space? dominic: in the u.k., inflation is falling in commodities and in the u.s. for a very specific reason, exaggerated and the communication sector but nevertheless it is still falling. the central banks have been revising lower than inflation forecast with the exception of the bank of england. that should be a warning sign to people. why is inflation falling? it is very simple, inflation went up but credit growth did not expand sufficiently to accommodate it which means there has to be a down cycle in inflation.
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it restored some balance as long as real growth is not slow down as well. it is always a concern if you see inflation weakening that real growth will be topping out. then the central banks that are "very cautious" are tightening too much. fedh 2008 was when the other first emergency meeting for bear stearns so let's not underestimate. a lot ons have gone up that measure of inflation and is important to be aware of the risk. janet yellen is making a type she is basically putting out a fire that may not exist, i.e. inflation. in the old days we worried about her making a type two error in which deflation was concerned and she was not going to do anything to stop it. vonnie: what is the alternative? at some point rates have to normalize.
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we would turn into japan, no? dominic: they are normalizing but the question is what level do they normalize to? the fed thinks they will get to 3% in the market is saying you will not get much beyond 1.5%. the answer is probably somewhere in the middle. certainly term premium very negative keeps the market level, it is a bit of a biased measure of the terminal rate but let's say the rate is 2.25%. that is where we are headed. if the fed gets carried away and keeps on pushing, then they will overshoot and you will start seeing problems for risk assets and that is the real concern. there is a balancing act. something like the amazon thing is fascinating because it is another source of deflationary or disinflationary pressure on the economy. mark: as you say, the exception to the rule is the u.k. and
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three dissenters on the monetary policy committee this week. do you expect the bank of england will hold steady and just ride out this period, even if some are concerned inflation is overshooting? do you expect the bank to ride out and keep the rate near record lows? dominic: they should ride it out and i expect them to. i do not think there should be a quick reaction to imported inflation because i think in this global economy it is quite hard to actually see that sort of starting an inflationary process separate from the rest of the world. the rest of the world is telling you global inflation is not a major concern, certainly not now. vonnie: that was fascinating what you said about the amazon and whole foods deal having deflationary consequences down the road. dominic: thank you. vonnie: dominic konstam from deutsche bank. do not miss bloomberg real yield
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live from black rocks trading floor. -- blackrock's trading floor. this is bloomberg. ♪
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vonnie: breaking we are following all morning, amazon and whole foods are potential he getting together, a deal in the works for $13.7 billion, amazon buying whole foods. mark: it is incredible, isn't it? look at the effect on the side of the atlantic. the biggest decline are is our -- that opens food lion and stop & shop, shares down 9%, the biggest decline since 2007. ♪
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vonnie: live from bloomberg world headquarters in new york and in london, i'm vonnie quinn. mark: and i mark barton. this is "bloomberg markets."
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courtney donohoe has more from new york. trump is president expected to start rolling back obama administration plans to open up relations with cuba. americanses a ban on in u.s. companies doing business with cuba's military. those restrictions will also prevent individuals from planning their own educational trips to cuba outside of peer groups. merkelchancellor angela is criticizing a u.s. senate proposal to expand energy sanctions on russia. she suggested as a bid to advance u.s. economic interests. it looks to ban western companies were being involved in some russian energy projects. in london, queen elizabeth and prince william met with volunteers who help survivors of the high-rise apartment fire. they went to a point of the disaster where community groups have been gathering supplies. at least 30 people were killed and dozens were missing. the death they hope count doesn't rise. hasesa may's government
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vowed to european union demands in the first stage of brides of talks. according to eu officials, and initial negotiations focus on departure. the u.k. brexit talks begin on monday. global news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i'm courtney donohoe, this is bloomberg. vonnie: back to the breaking m&a news of the day. amazon is agreed to by whole foods for $13.7 billion. the chairman of divisiveness and associates said this of the deal. >> there's no way to get a critical mass unless you buy a company, that's what they did. there will be the best a huge part of food now. i think this is brilliant, and i think it's exactly what amazon should do. more isjoining us with
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bloomberg editor-at-large cory johnson. of $13.7ou think billion? it's right in line with what one analyst at a price target. cory: we will wait for the guidances in terms of acquisitions. thingsly, amazon can do with whole foods at whole foods can do by itself, whether it's leverage, store capacity with more kinds of merchandise or expand that. but amazon trays a higher multiple them every grocery store imaginable. , this isundamentally not about being in the grocery business, but being in the delivery business and getting closer and closer to consumers. if you are the ceo whole foods, you been fighting off jana partners to have been wanting you to consider a buyout
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to guess you would have consider to be successful in what they wanted. john mackey keeps his job, but what about the path of whole foods and what is it going to look like a year or two? whole foodscover directly, but it just means they can really leverage the technology that amazon has. if you look at brick and, with a lack of technology. when you have a strong online competitor require you, you have technology your disposal and the ability to really move forward in today's world, which is changing and leading with cutting-edge technology. to whathave a listen david rubenstein had to say about jeff bezos being a genius. he had the last laugh, he's one of the two or three richest men in the world with one of the most accessible companies. underestimating him is not a smart thing to do.
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i would say of jeff bezos thinks it's a good idea, i suspect it is a pretty good idea. vonnie: he's into the turnaround and he should know what he's talking about, at least. cory: i'm not a big subscriber in that if they've had a good idea in the past, they will again as well. there are two kinds of people in the world. investors who say i've seen it all before and it's never different, those who say this is different. and amazonare wrong is a very peculiar company. there's no with a company like them. today and angeles amazon spends about $4 billion treating original content. they have a massive technology business, it's complete with changing the way every technology company does business. the fact that they are getting in the groceries i think is too small of a way.
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i think this has the potential of all ofssive extent amazon's businesses and they are getting closer and closer to the they have delivery capacity and distribution capacity that they've never had before. even amazon has ever had before. mark: if you are a competitor of amazon and whole foods, you look at the shares and they are all thinking today on both sides of the atlantic. what do you do now to compete with amazon? poonam: you have to add speed. it's all about speed and retail today. the consumer wants things instantaneously, within two hours, within the day, within two days. retailers really have to boost up their systems to be able to do so. and if you were on online retailer, you need to get closer to the customer. it's all about speed today. vonnie: what will be next? oppenheimer said there might be a rival bidder. do you see anyone else
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who could potentially pay that kind of price for network of stores like whole foods? cory: certainly, pe could get involved, safeway has a strong but money is cheap these days. i really do think that the possibility of leveraging the existing whole foods business for amazon is there unique ability to use technology and data to drive more revenues with every transaction. you get to know the consumer even better. amazon does an enormous amount of data processing. anyone knows amazon's website and you buy a book even it tells you so much more about what other things you might want to read. when you buy clothing, it shows your clothing you might want to buy. it knows so much about the consumer. it will take all this from whole foods transaction and will start getting into the consumer even better.
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the potential for accretive transaction is -- i can think of a business that could do better with backend of information and distribution system. mark: why now? amazon looked into buying whole foods last fall and decided not to do it. why now, six or seven months later? has been cracking the whip, demanding better performance from the stock. they certainly -- for as much difficulty is whole foods his hat in the last couple of years and struggles within the board room there, you also see that one of the reasons this goes through as all the other major grocery companies are trying to tryingse consumers and to sell it's not healthier food but with that seems healthier and that really is the sweet spot of the grocery business. it has the potential, you are not looking at the crummy
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margins of kroger or somebody else. what kind of brands does amazon already carry that it might have to get rid of because they would be in competition with the whole foods unique brands or things that made whole foods more special than the regular grocery stores? poonam: i don't think they need to necessarily get rid of anything. whole foods would complement their business, but whole foods has morganlander in intermix. i think that helps them broaden the reach. i don't think they really need to eliminate brands to make this a success. amazon is about building brands and bringing brands into its business. it's really a portfolio of brands, whether it's national or private that will sell. vonnie: do you see any regulatory problems or challenges here? poonam: no. amazon is only going to get bigger with the acquisition, but the food business is very fragmented, so whole foods is a small piece of it. it's not the entire business. i don't for see any regulatory
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issues. vonnie: of the directors they locker,board, foot morningstar, sharon mccomb of best buy come up in arab red -- panera bread is also on the board. what do they move on to next? other over the -- are there other problems they want to get into? good asyour guess is as mine. there's lots of interesting places to help turn around, that they can go to if it's used to. the retail was changing today, and it needs leaders to help drive the change. to poonam andanks cory johnson. mark: barclays, big day today. the bank planning to plan -- seriousilty to the fraud office charge when it failed to make proper
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disclosures about a multibillion pound capital raising in 2008. at the height of the financial crisis. this is a court into person with knowledge of the process. the fine is expected to be $100 million and 200 million pounds. the final amount will be decided by the judge. the sfo saying we are expecting to announce charging decisions within a few days. we wouldn't make any comment ahead of that. barclays is in commenting as well. the barclays is set to plan a guilty plea over disclosures in this qatar case. problem's that beset barclays is the financial crisis and we'll keep an eye on that. vonnie: hoping all this will eventually go away, that enough time has passed and the firewalls are put in place. president donald trump admits publicly is under investigation for fiery james comey, but he appears to put the blame on one of his own. this is bloomberg. ♪
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mark: live from new york and london, i am mark barton along with vonnie quinn. this is "bloomberg markets." vonnie: time now for the bloomberg quick take, where we invite context and backgrounds on issues of interest. president trump is set to make a major announcement in miami on u.s. cuba relations. cuba and the u.s. have had one of the world's strangest relationships. a caribbean island nation of just 11 million people lost in a seemingly permanent standoff with a superpower. thecold war promotion dispute in the first place. then the two established diplomatic relations after a five decade trade embargo.
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a new twist as president donald trump threatens to roll back the normalization process with a speech doing just about two hours. president argues that the cuban government asks -- got to suite of a deal under his predecessor, barack obama. he promised to provide greater access to the internet and mobile phones and has done so slowly. there are frequent arrests of dissidents. failed to diplomacy promote democracy, and obama let sent to relatives and permitted more experts of telecommunications agreement. they removed cuba from the list of state sponsors of terrorism and diplomatic relations formally resumed. after fidel castro allied cuba with the soviet union at the height of the cold war, the u.s. severed relations in 1961 and later impose a trade embargo. years of anticancer legislation in the u.s. culminated in the
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1996 act which established conditions for lifting the trade embargo. embargo permits enough trade mostly agriculture and products to make the u.s. cuba's biggest trading partner. sayorters of normalization it cheated u.s. companies of opportunities and left the u.s. -- they could help with leading cuban allies like venezuela. upon it say restoring ties through lifeline to a dying dictatorship just as economic growth is slowing. trump has also argued that obama's deal allowed the castro regime to continue. you can read more about u.s. cuban relations on the bloomberg. sticking with u.s. politics, president beltran has been in the news admitting publicly for the first time this morning that he has been being investigated for the firing of james comey. he tweeted ivan being investigated for firing the fbi
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director by the man who told me to fire the fbi director. which end. joining us now with the latest is stephen dennis on capitol hill. washington.rilli in let's start with this group, what can you tell us? kevin: the president tweeting earlier today that he is in fact being investigated for potential instruction of justice for firing of former fbi director james comey. i'm told by a source working with the president legal team the letter actually went out to the vendors and all those connected to the campaign for those to preserve documents. honorable "from the letter from former campaign director michael glassman says be sure you preserve any and all documents in your possession, custody, or control the related anyway to work on or for the committee, he goes on to write although i am confident there was no
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wrongdoing by the campaign or otherwise, it's important to the no documents or other materials relating to the committee's work are destroyed, lost, or otherwise become unavailable to the congressional committees for the special counsel. powerful note that the washington legal firm is also working now not only with the president, but also with the transition team and the campaign as the investigation on capitol hill and within the intelligence community very much is underway. vonnie: we have complaints, stephen dennis, from some members of congress that there shouldn't be a second investigation. where will they go and will be investigation continue anyway given the support from major players involved, including chuck grassley? think the president's troubles on capitol hill are sort of expanding fairly dramatically this week. the senate intelligence committee had been the main
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committee probing all of the russian investigation and interference in the election with possible collusion. the houseeen intelligence committee. this week the senate judiciary committee is launching a new robe with chuck grassley, the chairman republican and dianne feinstein, the top democrat working together to probe this firing of jim comey by the president. he continues to have repercussions. they want to have hearings, potentially have dianne feinstein wants jeff sessions, jim comey, comey associates all coming up here to testify. she wants subpoenaed to issued if they don't want to come. expect more fireworks here on the hill. it is something that concerns some republicans here, john cornyn, the number two senate republican told me it would be wholly inappropriate for congress to examine possible direction of justice, that's robert mueller's job. you think they would be
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duplicative for another committee to come in and bring some of the same people to capitol hill. the little bit of a split among republicans. vonnie: is there a risk, kevin offlli, that the woods gets of the trees, that there are so many investigations i going the central questions get lost or the culpability?> kevin: republicans are pretty much divided on this front. no one is saying that there's nothing for there to be charges in the republican party at least for been there to be charges to be brought against the president for instruction of justice, but i can tell you that we should note and underscore this that this is also the same week that the senate passed tougher russian sanctions against russia. this was led by a group of prominent republicans, including the senate banking committee chairman and senator lindsey graham. as they are trying to figure out whether there was obstruction of
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justice, it has kind of become a moot issue in the broader sense of republicans about the move to continue to pressure the russians and vladimir putin. but also the move forward with sanctions and to bolster cybersecurity. the president is trying to keep moving forward with his agenda and he struggled with that in keeping focus on it. he's in miami today was senator marco rubio, the republican from florida to announce the rollback on the obama administration's looser double ties and economic ties to cuba. vonnie: bloomberg congressional reporter stephen dennis and national political correspondent kevin's really both in washington, d.c. mark: still ahead on "bloomberg markets," greece gets another lifeline in luxembourg. this is bloomberg. ♪
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vonnie: live from london and new
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york, on vonnie quinn. mark: i am mark barton, this is "bloomberg markets." started a deal to avoid bankruptcy again. creditors seeking at least $8.5 billion in new loans for athens commanding months of uncertainty over whether it could meet bond statements due in july. bloomberg's nejra cehic has been following the meeting this week and she joins us. we come to an agreement, but the imf is involved. extent,hey are to some and as you say, we've got about 8.5 billion euro payouts that would allow greece to meet its debt obligation for july. where the deal fell short was on the debt sustainability of the debt relief. it fell short to the point of the imf was not willing to put up funds straight away. it said it would recommend a 14 month standby loan and paying that i would be contingent on getting more reassurance about debt sustainability.
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i spoke to the portuguese finance minister and asked does this mean they can has been kicked down the road again and the deal didn't go far enough? >> we have at this stage, a huge recognition of all the effort that the greek authorities and the greek people are making. with great results they are having and we think that we need to go along these lines and we are pretty much confident that we will get to a very strong, robust debt analysis that will launch and pave the way for greece to have success for all the programs and all the success we expected to confirm. the imf not recognizing greece's debt is sustainable, it means greece still ineligible for the ecb's bond buying program. it didn't get everything he wanted out of this meeting. mark: the chancellor is also near you with the u.n. in
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luxembourg. an interesting tone when he spoke about brexit. very different from the town that prime minister theresa may check during the election campaign. nejra: absolutely. as you know, chancellor philip hammond has become the vanguard for a softer brexit. when he arrived in luxembourg he was talking about pragmatism and cooperation with the eu. he was asked about whether the u.k. might stay in the single market and he said i'm not giving the blow-by-blow account of negotiations but there was a softer tone. i did ask him whether the priority would be more on the economy and jobs, rather than immigration. here's what he told me. >> we're just about to start a negotiation we set out very clearly our desired outcome and the prime ministers lancaster house speech and in the article 50 letter that we sent. it is a negotiation and as we go into that negotiation, clearview
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is that we will prioritize protecting jobs, protecting economic growth and protecting prosperity. as you can see, a little bit of a softer tone before the negotiations start on monday. they are starting in brussels between brands and the eu chief negotiator starting in brussels on monday and at the same time, we've heard according to eu officials that the u.k. might exceed to separating this one from trade negotiations. mark: nejra cehic in london -- in luxembourg. 10:56 in new york. coming up with the european close and we are 30 minutes away from the end of the friday session area this is bloomberg. ♪
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vonnie: breaking news, amazon is buying whole foods and retailers are showing reaction around the world, including europe. oppenheimer saying there may be competing better, this is the
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european close on "bloomberg markets." on vonnie quinn. mark: i am mark barton. trading lower, pulled lower by consumer staple stocks. i should also mention of the top of the last hour we got the university of michigan consumer confidence, which should show the biggest drop in sentiment since october. that is in the nikkei in mind as we look at a big consumer deal this morning. as one he mentioned, the folks at oppenheimer are saying another bidder could emerge for whole foods, but if you look at how the stock is trading at how amazon is trading at, it doesn't seem the market is really pricing in that possibility. the stake a look at shares here. because we have whole foods trading up nearly to the offer price, one would think of traders really got another bidder was going to emerge, he will be trading above the offer price of $42 a share, up 27% here. amazon shares are also trading up as it looks like investors like this

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